Generics Market Share Seen Soaring in France

According to data supplied by industry group GERS, the popularity of generics in France continued to increase in 2004. Sales in the year soared by 47% to EUR1.1bn (US$1.45bn), although even this rate is below the 64% level recorded in 2002 and the 55% rise in 2003. While generics now account for 13% of market volume and 7% of the drug sector's overall value, the government is targeting a generics market share of 23% in the medium term.

The target does not appear entirely unrealistic, as a number of patents on blockbuster drugs are scheduled to expire in the coming years, with Merck & Co.'s Zocor (simvastatin) and Pfizer's antidepressant Zoloft (sertraline) expiring in 2005. In 2004, more than 20 leading drugs lost patent protection, implying substantial losses for firms including UK- and Sweden-based drugmaker AstraZeneca and leading French producer sanofi-aventis. Industry sources have claimed that by 2007, some 30% of France's current reimbursement list will carry generic alternatives following patent expiry.

However, several leading multinationals are set to prosper from the trend, with the generics businesses of Germany's Merck KGaA, France's Servier and Switzerland's Novartis all reporting strong sales in 2004. Indeed, Novartis has estimated that the market share of generics in France is set to double, with the sector accounting for 10% of total market value by 2009. Meanwhile, the country is set to become a European beachhead for foreign generics makers, with many Indian firms boosting their local presence. The government has also recently examined claims that some pharmacists have secured distribution agreements implying profit margins of up to 70% on generic products.